Lloyds bank sets aside £1b more for costs over mis-selling

london — Britain’s state-rescued Lloyds Banking Group on Wednesday said it had set aside a further £1.0 billion ($1.2 billion) to compensate customers who were mis-sold insurance.

The hit contributed towards LBG reporting a sharp drop in third-quarter net profits, to £219 million compared with a year earlier, the company said in an earnings statement.

However, profit after tax for the nine months to the end of September jumped 30 per cent to £2.0 billion.

The update comes amid widespread concern across the financial sector that Brexit will hamper Britain-based banks in carrying out business across the European Union.

LBG chief executive Antonio Horta-Osorio said in Wednesday’s company statement that “the outlook for the UK economy remains uncertain, however the strength of the recovery in recent years means the UK is well positioned”.

Bank of England chief Mark Carney on Tuesday said banks were in a position to “adjust” their operations over the next year, when asked about the prospect of lenders relocating abroad because of Brexit.

Reacting to comments over the weekend from Britain’s powerful banking lobby, Carney told a parliamentary committee that certain “institutions would be in a position to adjust some activities over the course of the next year if they saw fit”.

Away from Brexit, Lloyds’ compensation for mis-sold payment protection insurance (PPI) now totals more than £17 billion — far in excess of other British banks caught up in the long-running scandal. — AFP